Goldman Sachs sees Brent crude stuck at $80-$90 amid U.S.-Iran war uncertainty

Goldman Sachs The Goldman Sachs Group, Inc. ↗ 0.41% said on Tuesday it expects Brent crude to trade in an $80-$90 per barrel range until there is either confirmation of a new U.S.-Iran nuclear deal or a major escalation in the five-month-old conflict between the two countries.reuters

The investment bank estimated Brent's fair value at roughly $80 a barrel, suggesting markets are pricing in only a modest risk premium despite persistent uncertainty over Middle East oil supplies. Brent traded near $85 on Tuesday as conflicting signals from Washington and Tehran over the status of negotiations continued to cloud the outlook.investing+1

Physical Markets Tightening

Despite the recent retreat in prices from earlier highs, Goldman said physical oil market conditions have continued to deteriorate. The bank's global visible stocks counter showed a drawdown of 6.3 million barrels per day over the past two weeks, driven by reduced flows from the Persian Gulf and Red Sea, lower Russian exports, and stronger Asian imports — particularly into China.investing

Gulf oil exports have fallen to about 36% of pre-war levels on a seven-day moving average, down sharply from nearly 80% in early July. Loaded tanker capacity in the Red Sea has dropped 22% since Iran-aligned Houthi forces announced a blockade. Saudi oil exports are estimated to be down 2.4 million barrels per day from a year earlier, though shipments have increasingly been rerouted through Egypt's SUMED pipeline.reuters+1

Russian crude and condensate exports also declined by 1.3 million barrels per day over the past two weeks, while recurring disruptions at the CPC terminal in the Black Sea have kept shipments well below normal levels.reuters

Three Chokepoints, One Worst Case

In a separate Bloomberg appearance on August 3, Goldman analyst Samantha Dart warned that three simultaneous crises — at the Strait of Hormuz, the Red Sea, and the Black Sea — could push Brent as high as $120 a barrel by the fourth quarter if disruptions persist.247wallst

"This is unprecedented. And it really reminds us that even though we're so used to thinking of commodities as these global markets, your supply side can be incredibly geographically concentrated," Dart said.247wallst

Dart's base case envisions Persian Gulf production normalizing by early fourth quarter, allowing Brent to average about $80 in Q4 and $70 next year. Her worst case — a gradual improvement stretching into 2027 — would mean $120 in Q4 2026 and an average near $100 next year.247wallst

The key variable remains the speed of geopolitical resolution. A durable de-escalation across all three chokepoints would let rising U.S. production pull prices toward the lower end; a drawn-out standoff, particularly heading into winter when heating fuel demand spikes, could push them sharply higher.247wallst